Trends in State Banking Supervision: A Snapshot View

Report Summary

Trends in State Banking Supervision: A Snapshot View

State regulators stand poised to act on topics with strong consumer protection implications, such as mortgages and lending.

Boston, MA, November 20, 2007 – A new report from Aite Group, LLC provides insight into the current thinking among state regulators. It aims to guide financial institutions in determining which issues will capture regulators' attention in the coming months and years, and reveals insights that institutions can use to fine-tune their regulatory strategies.

According to the report, titled "Trends in State Banking Supervision: A Snapshot View," compliance topics likely to receive the greatest amount of regulatory focus relate to the mortgage industry and are a direct result of the subprime mortgage crisis. State regulators surveyed expect both mortgage brokers and mortgage lending to be top priorities over the next 24 months, with survey participants giving an average score of 4, on a scale in which 5 means the topic is very likely to receive regulatory attention and 1 means it is unlikely.

As attention to these and other compliance issues increases, state regulators will be under pressure to track more issues at a higher level of detail than ever before. However, survey results also show regulators' budgets are either flat or rising. The implication for institutions is that they must expect regulatory scrutiny to continue to increase.

"State regulators wield considerable influence over financial institutions," says Eva Weber, analyst with Aite Group and author of this report. "Their supervisory power and position as the primary, local force behind consumer protections mean that institutions must be prepared to respond immediately to any regulatory changes that take place, in any state in which they do business."

This 21-page Impact Report contains 10 Figures and 6 Tables. Clients of Aite Group's Retail Banking service can download the report.

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